KR1 October Update 🦄

Web3: Why do we need it?

KR1 is a UK public company trading on the London NEX public market focused on investing and supporting blockchain and decentralised technologies called ‘Web3’. We have been an early investor and supporter of many key Web3 projects.

1,2,3!

Web3 is a badge for the new movement of the decentralised web, one that offers to replace the current insecure and rent seeking internet and unlocks new types of trust-less services that could have never been imagined before.

Internet History

The nineties first gave us the World Wide Web, “Web 1.0”, and offered us poor pot holed roads on the “information superhighway”, which meant only limited text heavy places to visit such as Yahoo directory pages, AOL and Geocities… all of this happened in cars (modems) that were very, very slow.

Web 1 was basic but free.

Then the second Web rose from the ashes of the Dotcom bust onwards with an interactive web, “Web 2.0”, as it became known and offered airplanes instead of cars (via broadband) to travel the information sky-ways to eye candy byte filled resort destinations like Facebook, YouTube… and on your mobile!

Web 2 was colorful but came at a cost

Unfortunately, those services became rent seeking citadels with robbers on the fringe hacking your Ebay and Paypal accounts, credit cards and data. Your privacy was sold at the city gates to the highest bidder, like slaves being sold into enslavement (even though you didn’t know it, ever wondered “why are those ads following me around the web?”). As we were reminded at this years Ethereum Devcon4 conference by Stewart BrandInformation wants to be free”, not co-opted by corporations, especially ones wearing branded hoodies espousing ideals.

There is a better way surely? Well Web 3.0 is here and it’s like having a private jet to fly around the information cosmos: no queues, no security issues, no datas leaks, super fast travel and you get paid for giving you data when you agree! Its where privacy and security are put first and new (trust-less) services are a reality, a first for mankind and the computer science space.

Web 3.0 as a term in its current incarnation was initially coined by Gavin Wood. Check out his initial visions for a “zero-trust interaction system”, a less-techy version of the same ideas or a version recently published in Breaker Magazine.

Web 3 is a world of new (secure) possibilities

Web 3 is being led by Ethereum, Polkadot, Cosmos, Dfinity and a few other ‘Level-1' Blockchains. Polkadot is helmed by Gavin Wood, co-founder of Ethereum, founder of Parity Technologies and the Web3 Foundation.

Web3 Summit in Berlin

Web3 Summit

We all gathered in Berlin for the first Web3 conference to really name ‘Web3’ as a thing. What we saw showed why Polkadot will be a top flight Web3 blockchain with the release of Substrate and several other associated projects involved in Polkadot. All of the Web3 Summit videos are available on Youtube.

Why are we so excited about Substrate and Polkadot? Substrate allows the creation of blockchains within minutes not weeks, you can swop out the consensus mechanism and has other groundbreaking features. Polkadot allows for blockchain interoperability, which will create massive value in expanding the decentralized internet protocols for blockchains to safely and reliably interact with one another. Blockchain interoperability can significantly increase scalability, speed, and extensibility of blockchains. It allows for private, public, and consortium blockchains to connect with each other and eventually blockchains could even interoperate with fiat banking systems like SWIFT. A lot of new decentralised services will be built with Polkadot and Substrate. For these reasons KR1 is a major backer and holds a significant stake in Polkadot.

Gavin’s Substrate presentation and live-coding session

An exciting project to watch that we saw at the Web3 Summit was Edgwa.re, a “experimental blockchain for demonstrating the effectiveness of on-chain governance”. Participants in the network vote, delegate, and fund each other to improve the incentivized network that is completely built on Substrate.

Dillon and Raymond from Edgwa.re

Also at Web3 was an exciting team from London called Vega. Vega is a new liquidity protocol for ‘decentralised margin trading of custom financial products’. Currently it is prohibitively expensive to launch and run a market (we’re talking millions of dollars). Using Vega, anyone can create products, make markets, and trade for just dollars.

Rebecca, Tamlyn and Chris from Team Vega demoing at the Web 3 breakout room.

Vo1t Investment Update

We are very excited to announce that Vo1t, a institutional digital asset custodian and portfolio company of ours, has completed a successful fundraising round at a post-money valuation of USD $17 million. The funding round saw participation from a highly regarded family office and strategic individuals in the digital asset and traditional financial industry. We are especially thrilled as we seed funded Vo1t early in their cycle as pure equity investment, not tokens as we normally do.

Following completion of Vo1t’s funding round and the conversion of Vo1t convertible loan notes held by KR1, we hold a fully-diluted position in Vo1t that represents 7.94% of the company. At the post-money valuation that values KR1’s stake in Vo1t at around USD $1.4 million.

Vo1t is a institutional digital asset custodian, that offers clients safe storage of digital assets including BTC, ETH and numerous others. In addition to the cold-storage service, Vo1t offers bespoke integrations into institutional financial infrastructure solutions as well as a white-labelled and “Storage-as-a-Service” solution for regulated traditional custodians or digital asset exchanges.

“Vo1t have extended their service offering significantly to exchanges and leading financial institutions exploring digital assets and the blockchain space. The company’s assets in custody increased significantly from our seed round participation earlier in 2017.”

George McDonaugh, KR1

Vo1t was featured in a Forbes story by Oliver Smith recently, a first key piece of press after some silence.

Forbes Vo1t article

David Allen, the chief operating officer of Equity Trust, an IRA and 401(k) provider with $12 billion under management, confirmed to Forbes that it stores its crypto holdings with Vo1t.

“Vo1t have the technology, speed and security to keep our clients’ digital assets safe and the ability to quickly withdraw and convert back to cash when they need,” he said.

Some of the investor community are just picking up how much of big deal this is. The bigger the space grows the more valuable Vo1t gets.

Ethereum Devcon 4 ‎️‍🌈

The biggest Devcon to date!

We have to pause for a moment and give Vitalik, Aya, Vlad, Justin and the others who founded and run Ethereum the full credit due. Ethereum was an experiment into decentralisation with an uncertain future with scaling not figured out — after going to last weeks Ethereum annual gathering called Devcon4 in Prague we can now say the future is looking more secure and very bright. Even Eric Schmidt from Google is rooting for Ethereum. Although scaling is not here today, “Ethereum 2.0”, “Serenity” or “Shasper”, however it’s called… is coming!

The size and scale of the Ethereum community means its now an industry with tens of thousands of developers, the very best thinkers and incredible researchers. The community’s energy is as strong as ever and still very much on track with their mission to “decentralise the world! So for us the key takeaway from the annual Ethereum tribal gathering is not that Vitalik can’t sing… it is that they are getting there(!) and, as ever, with the usual sense of unicorn 🦄 and rainbow ️‍🌈 humor we have come to love.

Vitalik in his keynote speech, took us on a history lesson of failed Ethereum scaling projects and previous attacks, leading to the current plan.

Vitalik relives the Devcon 2 Shanghai DOS attacks

Vitalik then outlined the plan ahead, which would be the final phase of Ethereum’s development roadmap before prime-time, where you all clamber into the earlier mentioned metaphorical private jets and cruise the blockchain information airwaves. When Ethereum’s Proof of Stake, the token staking model called Casper, is released, it will bring a huge surge of interest to Ether from the mainstream, as it’ll come close to earning passive income yields. We believe this will be as significant as the security token movement.

In other talks around Devcon4 Sid from Coinbase also gave a talk and reminded us on the crazy growth that is happening in the whole Ethereum ecosystem.

Ethereum keeps growing …

Devcon 4 KR1 Portfolio Highlights

Argent 👍

KR1 seed funded wallet project Argent that won the Devcon user experience (UX) prize!

The Argent app waitlist is now open install for Google Play and iOS. There are many brilliant features that you will want!

Melon 🚀

Jenna Zenk from Melon announced it’s going fully decentralised, as planned, in Feb 2019 (this does not mean the Melon protocol will disappear, in fact this is just the start). Melon is a decentralised protocol to allow first of its kind technology-regulated funds, designed specifically for the purposes of crypto asset management. “Both, its frontend as well as its backend are hosted and executed on decentralised platforms. The frontend operates on top of IPFS, while the backend leverages off a set of Ethereum smart contracts.”

A front end showing the Melon protocol at work

We are big fans of Mona, Jenna, Hansen and the crew and believe their vision of decentralised asset management is getting closer and closer by the day.

Jenna on how Melon goes fully decentralised in February 2019

Flying Carpet 🎺

It’s great to see that Julien Bouteloup and crew have pivoted their way into something that looks highly valuable for data scientists, allowing them to get rewarded for making useful data models.

Flyingcarpet network provides organizations and smart contracts with geospatial truth. Data scientists compete to create machine learning models from satellite imagery. Models are tradeable via NFT ownership tokens.

Julien’s jacket crossing the bridge in Prague heading to Devcon4

We are proud supporters and early investors of Flying Carpet.

Flying Carpet website

Offsite at Devcon4: Chainspace 🔔

Ten minutes away from Devcon there was presentation of Chainspace with co-founder George Danezis giving a quite brilliant presentation of the new project Chainspace, a planetary scale new smart contact platform.

George introducing Chainspace

George is one of the worlds most renown cryptographers and is Professor of Security and Privacy Engineering and head of the Information Security Group of the Computer Science department at University College London and also a faculty fellow at the Turing Institute.

Huge throughput — up to 500k Transactions per second in its current iteration
Devs can use their own language which then gets compiled onto the blockchain
“We are already live with half of the major core areas”

The evening was well put together by Asian VC Lemniscap.

Chainspace is the largest and most significant project to come out of London (aside from the legendary Matrix.org) that we have seen in the decentralised space.

CoinFund’s meetup

Shoutout to our good friends at CoinFund and Cambrial for a great meetup around Devcon featuring some staking talk. Panel featuring (KR1 seed funded) Rocketpool!

CoinFund and Cambrial Staking Meetup

Out and About

Bpifrance Inno Génération in Paris

Janos gave a dynamic talk and primer on decentralized technologies to eager listeners at the vast Bpifrance Inno Génération conference in Paris, organized by France’s Banque publique d’investissement.

Janos Berghorn on decentralized technologies in front of the French technology and VC crowd in Paris!
Janos Berghorn and the Paris crowd.
Bpifrance Inno Génération event, massive!

Bitmeet London

George gave a talk at the largest student-led Blockchain conference in London on 13th Oct. The topic? big surprise… was KR1, but this time instead of the usual ‘what we do and how we do it’ talk, George took the audience through the history of KR1, how it started and how far we’ve come since our first tentative steps setting out into the unknown.

It may seem a little odd talking of ‘history’ when concerning a company that’s not quite yet three years old, but time in cryptoland doesn’t tick by like with the rest of the world, everything moves at light speed. When we signed the incorporation documents for KR1 there had been just TWO ICO’s, so we do have a fairly unique viewpoint of how the space has developed and we can offer some key insights into how to navigate this incredibly exciting space. There are times it feels like we‘ve managed to catch the very crest of the biggest tech wave since Sir Tim Berners Lee figured he’d like to chat to his fellow scientists at Cern a little easier.

In the Press

Web3 Summit

Keld was quoted in Techcrunch on the launch of Substrate from Polkadot;

Keld Live on air with OST

Check out the full recording in the Youtube video below.

Keld on OST LIVE chatting about Investing in Early Stage Decentralized and Open Source Blockchain Projects

Catch us at

Cambridge University: Blockchain Meetup

George will be talking at the Judge Business School at the Cambridge University Blockchain meetup on November 14th at 6pm. And will be joined by Justin Drake who is leading the sharding Ethereum team (whoohoo!) to talk about going from Cambridge to Ethereum! Grab tickets here.

Justin Drake on stage at Devcon 4 just last week, next week on stage with KR1 George at Cambridge University

CV Summit in Zug

VC in a decentralized world panel

Keld will be speaking on the Venture Capital in a Decentralized World at the Crypto Valley Blockchain Summit in Zug, Switzerland on Wednesday, November 6th.

Grincon0

Hey Grin!

We are very excited to announce our sponsorship of the first mimblewimble magic Grincon0 at the venue c-base Raumstation, Rungestrasse 20, Berlin Friday evening, November 9th.

Follow us on Twitter for more updates.

See you in November!

KR1 plc is Europe's leading publicly listed investment company focused on blockchain and decentralised technologies (KR1:AQSE). KR1 was founded in March 2016.